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Three solutions that could help you reduce your CAC in 2025
Summary
- CAC is increasing in 2025 due to economic pressure, ad inflation, and tighter regulations.
- Brands like ASOS and Naked Wines are moving away from transactional marketing.
- Strategic brand partnerships are proving more effective than paid media alone.
Customer acquisition costs (CAC) in the UK have reached an all-time high in 2025. Between tighter budgets, declining consumer confidence, and increased competition for digital ad space, acquiring new customers is more expensive and less effective than ever before.
While paid media channels are delivering diminishing returns, leading brands are shifting focus. They are moving towards loyalty, retention, and brand partnerships to drive growth without overspending.
Why Are Customer Acquisition Costs Increasing?
Recent research and market analysis show a number of factors pushing CAC higher across the UK market:
- Economic uncertainty: The UK economy is expected to grow just 0.3% in 2025, following years of post-pandemic recovery and international trade disruption (EY UK Economic Forecast, April 2025).
- Lower consumer spending: Consumer spending is predicted to rise only 1.3% this year, which is modest compared to pre-2020 trends (KPMG Economic Outlook).
- Advertising inflation: Increased demand across Meta, Google, and TikTok is driving up CPMs, while audience targeting is becoming less precise due to data privacy regulations.
- Marketing budget cuts: For the first time in four years, UK businesses are scaling back ad budgets (Financial Times, 2025). Targets are going up, but budgets aren’t, making it harder for marketers to test, optimise, and drive growth effectively..
These changes are putting pressure on e-commerce brands to rethink their acquisition strategies. Paying more to get less is not sustainable.
How Leading Brands Are Responding
Several high-profile UK and European brands are reworking their acquisition and loyalty strategies to stay competitive.
To stay ahead, major brands are rethinking their approach. Here’s how:
- ASOS is prioritising more agile product sourcing and dynamic pricing models to improve conversions from existing traffic.
- Naked Wines is investing in customer community-building instead of relying on deep discounts to attract new buyers.
These brands understand that acquisition must be part of a broader value-driven marketing strategy.
Brand Partnerships: A Smarter Way to Acquire Customers
Brand partnerships are a powerful way to reduce customer acquisition costs while boosting conversion rates. Instead of relying on discounts, brands can add value through access to complementary partners enhancing the offer and reaching new audiences without extra spend.
Why partnerships work:
- You reach new audiences with built-in trust
- You offer high-value rewards that feel generous, not transactional
- You reduce dependency on Facebook or Google Ads
- You share campaign costs and creative resources
How Tyviso Helps Brands Win Without the Cost
Tyviso enables e-commerce managers to grow faster and convert better by using strategic brand partnerships at the checkout stage. We connect your store with premium brands and arrange high-perceived-value rewards that delight your customers and drive purchase completions.
There is no cost to you. We manage the partners, performance, creative, and reporting. You get improved results, better experiences, and loyal customers, all without adding pressure to your acquisition budget.
If you are an e-commerce manager looking to grow sustainably, Tyviso can help you do more with less. Get in touch today to see how it works.
Resources
- EY UK Economic Forecast – April 2025
- KPMG UK Economic Outlook – 2025
- Financial Times – UK Ad Budgets Shrink in 2025
- Vogue Business – Why Retailers Are Investing in Partnerships
- Tyviso Case Studies
Transcript
“At Tyviso we know that brand partnerships are the key to unlocking higher revenue without spending additional budget or offering discounts that eat into your margins. Our science-led approach has consistently delivered outstanding results. In fact, we are delighted to share a new record set by Haier, who achieved a remarkable 177% increase in basket completion rates by adding value through carefully chosen gifts with purchase.”
